Milbank LLP advised Hut 8 Corp. (Nasdaq, TSX: HUT) (“Hut 8”), a leading energy infrastructure platform integrating power, digital infrastructure and compute at scale to fuel next-generation, energy-intensive use cases, in connection with the closing of a $3.25 billion offering of investment-grade senior secured notes by its wholly owned subsidiary. The offering was completed through a private placement to qualified institutional buyers pursuant to Rule 144A and outside the United States pursuant to Regulation S under the Securities Act.
The financing is the first single-sponsor data center project to access the investment-grade construction bond market and was the highest loan-to-cost ratio (95% LTC) ever achieved for a high-performance computing data center bond. The notes will fully amortize by the maturity date, eliminating refinancing risk. The proceeds from the notes will be used to finance the development and construction of a turnkey data center with 245 MW of critical IT capacity and the related substation at Hut 8’s River Bend campus. The facility is fully leased under a long-term triple-net lease to a hyperscale tenant.
“This landmark financing underscores the strength of investor demand for investment-grade opportunities in digital infrastructure backed by high-quality sponsors and long-term contracted cash flows,” said Corporate Finance and Securities partner and practice group leader Jonathon Jackson. “As one of the first data center projects to access the investment-grade construction bond market, this transaction demonstrates the market’s confidence in well-structured, fully amortizing capital structures that eliminate refinancing risk. The successful execution of this offering reflects the continued ability of compelling digital infrastructure projects to attract significant institutional interest and achieve highly competitive terms.”
The Milbank team was led by Mr. Jackson and included Real Estate partner Alex Meirowitz, Global Project, Energy and Infrastructure Finance partners and co-chairs of Milbank’s Digital Infrastructure Practice Group Dan Bartfeld and Jaime Ramirez and Corporate Finance and Securities partner Adam Brenneman. The team also included Corporate Finance and Securities associates Moses Farzan Nekou, Ian Hunley, Allison Mahoney and law clerk Kelsey Rodriguez, along with Global Project, Energy and Infrastructure Finance associate James Lim and Real Estate associate Adam Mikell.
Milbank’s Digital Infrastructure Practice Group is the leading legal advisor driving digital infrastructure transactions across the entire value chain — from GPU procurement to powered land, data centers, buy-side/sell-side and capital raises (debt/equity) throughout the capital stack. Milbank has had the lead legal role in over $500 billion of digital focused transactions, including several of the largest capital markets, project finance, M&A and real estate transactions to date.
